Ideation for Product Innovation : What are the best methods ?

The aggressive revenue growth goals of most firms point to the need for a deliberate, systemic, and managed approach to generating game-changing new product ideas. According to a 2005 Arthur D. Little global study, of five best practices identified, idea management has the strongest impact on the increase in sales by new products. In other words, having effective idea management results in an extra 7.2 percent of sales from new products.1 The first place to begin crafting an effective ideation system is by identifying potential sources of ideas: Where do the good ideas come from? And more important, where should they be coming from and which valuable sources are you missing? Favorite idea sources may be evident in your company, but there is a lack of substantial research to reveal the most effective idea sources. Our study looked at 18 different sources of new product ideas in business.2 We sought to determine how extensively each method is used (its popularity), and to gauge management’s perception of the effectiveness of the method in generating excellent, high-value new product ideas. A total of 160 firms took part in the study; the breakdown of firms is in Exhibit 1. Exhibit 2 reveals the popularity and effectiveness of each of the 18 methods in a magic ideation quadrant diagram.3 The popularity is measured by the percentage of firms that extensively use each method—shown across on the horizontal axis (usage was captured on a 0–10 scale; “extensive users” are those that checked the top third of this 10-point usage scale). Rated effectiveness of each method is shown as a 0–10 scale on the vertical axis in Exhibit 2, but only for users of that method. (The argument here is that non-users do not have enough experience with the method to rate its effectiveness.) Ideation methods that are both popular and effective are in the desirable upper right quadrant.